YM journal

[frugi]

Cheers Cman, I'm just chipping away cautiously, missing the action as ever but happy

I would imagine it to be a useful scalping tool but not much else imho

That's me sorted then roguetrader

As Chartman has mentioned I mainly use Tick - as an element of entry confirmation - when it diverges from price, especially when I think the market is rangebound, or at least not strongly trending.
It can also help confirm tops and bottom of ranges by forming a rectangle pattern itself, as mentioned previously (+/-500 etc.) Often when a price range breaks the Tick pattern will confirm, or not, with a BO of its own.
Fading extreme values for little scalps often works, yes. Watch out for the odd freight train carrying nothing but high Tick values for several carriages/minutes though lol
Re strong up trends: when Tick has bounced off zero for a good portion of the day, a long off 0 (esp as part of a Grail entry) is a sound bet, if one has a predefined target, can often close when Tick = +1000 to squeeze out a couple of extra points. Tick pushing above 1000 on rallies probably indicates institutional buying, especially in the last hour after bonds have closed when things can really heat up,

I hope China W is able to comment on Tick further at some point, cause he uses it brilliantly. Or used to before he became a darksider and discarded his last stabiliser.

 

[frugi]

Lazy day

An uneventful +22 from two scalps and now I require pizza

Missed a decent short at 18:50, but, again, I thought we'd get a third peak up to 685-90ish which would have fitted with a 3rd wave up of equal length to the first between 16:00-16:30 so didn't risk it. Still the vol climax at 18:25 followed by the 3 divergences at 675/18:50ish (also INDU magic 64) were convincing, in hindsight.

Must say I am becoming more comfortable with these 10 point scalps as entry and exit can be clinically accurate when I get it right. Famous last words!

 

[frugi]

I'm not meant to be working today

Staying with old friends in the country (aaargh dial up) so wasn't intending to trade today.
Grabbed +9 by mistake showing one of them how to use TWS; oops that'll mess up the points average. Mustn't grumble, mind

Sorry no chart today, posting takes up valuable conversation time, but must maintain continuity....

Have a bonny weekend all

 

[frugi]

Scrappy fru

+24 from three.

Should have been closer to +40 were it not for my needless chickening out of a perfectly decent Grail long around 16:49. I put in a trailing stop when there was no need, or, more importantly, any trading rule to recommend this action. Of course I rationalised it by saying "Well if I'm stopped out for +1 here then I've lost nowt and there's every chance of an entry 3 points lower at 630 off the triangle TL from yesterday." Well, there wasn't an entry there as it didn't go down that far, so I missed 17 points as it rallied to the target of the previous high at 650. A timely reminder that my rules are there for a reason. No, they're not cast in marble, but on this occasion I failed to follow even their principle. Stupid Clanger.

The first trade of the day will take some justification as well. All I can say is perhaps my intuition had a hand (or at least a wee ganglion) in it. The trade just ' felt' right and I took it with a feeling of peculiar detachment, like I was on autopilot. Hey - perhaps I accidentally made Socratic use of time, who knows? More likely pure luck innit. Incidentally having read Douglas I am not extracting the pee with that time bending remark: if our lives can flash before our eyes in a matter of microseconds, e.g as frequently happens in a near-death experience (because, being pure energy, not matter, our memories take up no physical space and can be recalled literally at light speed) then there is no reason why one can one not 'slow down' our assimilation and judgment of price action in the same way. It's not seeing into the future: it's being able to relate the present action to our past experiences in a very short time indeed, much faster than our conscious mind would have us believe. Perhaps, lol, I've confused myself now, but there's something in this for sure.

Anyway, I have recently added a crude T&S (time n sales) window on my screen and when the price briefly dipped to 585 I watched the orders go through intently. It seemed to me that there was a nest of fervently eager multiple contract wielding bulls waiting there to push it straight back up so I joined in at 588, exiting for 19 as I'd been swiftly and surprisingly rewarded in just two minutes. Is this what they mean by letting the subconscious having its way because it knows more about the sum total of our experiences than the conscious does? Would I have bothered saying the above if it had been a losing trade? Hmm. Often I feel my post match analysis reeks of curve fitting, but there was no denying the trade was quite good and so I'm wondering whether there was more to it than luck. As ever, time will tell.

There was no ND at the 20:33 low so I didn't take a long, especially as we were only 30 mins from the close and there was a good chance the market would, having gathered downside momentum since H-hour at 20:10, 'lay an egg', to borrow a wonderful phrase.

:cheesy:

 

[frugi]

A gap. The bigger the better. This will apply to a stock or an index. Now, a gap doesn’t tell you what way the trend day will be, but it tells you that its very likely when it occurs after any of the above criteria. Watch for the break of the first 60 minutes trading range.

Once that range is broken, 70% of the time that will be the direction for the rest of the day. Large gaps lead to trend days because one side of the market is trapped and they have to get out.

Whenever traders "have" to do something, crazy things happen. Trend day up is triggered as stops are hit, or a trend day down is triggered as the stops are hit from open trades.

High volume. Most trend days have high volume. If the volume is not heavy, you may have a "trend morning" but then a reversal in the afternoon. The trend days occur when one side of the market is very excited or trapped.
Volume will show you exactly how excited or trapped they are, and obviously if the volume is low, the greed or fear levels are also relatively low compared to what wed want to see.

Extreme TRIN readings and a strong TREND in the TRIN. The TRIN is also knows as the ARMS Index after its creator, Dick Arms. It is composed as follows: Advancing Issues/ Declining Issues * Up Volume/Down Volume. Normally the TRIN will fluctuate between 0.8 and 1.2. On a trend day up, you will see the TRIN low all day and trending lower.

This shows you no selling is coming in. It shows you net buyers. Of all the indicators I watch, TRIN is the most important to me. I hate trading when the TRIN data is screwed up...happens about 1 or 2 times a month.

Next is the TICK, which is the next indicator I look at. This represents stocks trading on an up tick vs. a downtick on the last trade. I want to see a trending TICK and also some big moves in the TICKS showing institutional activity. For a trend day UP, I want to see pullbacks in the TICKS leading to general buying.

Watch a trend day over noon, because this is when it often gives things up, and you end up with only a trend morning. If volume is light, the TICKS are bad or the TRIN isn’t good. Cancel all bets over noon. Its going to flip to the close to 75% of the time.

A trend day is defined more or less by extremes. Extreme open, Extreme TICKS and TRIN. Extreme Volume. All of this of course adds up to extreme emotions on the part of traders.

Mooms on trend days, stolen from another thread. I've stuck it here so I can find it quickly and compare to other trend notes. I think we're due a trend day tomorrow or Wednesday and I don't want to be caught short.

 

[frugi]

Half century...

...including a free bottle of wine

+52 from five. Anything over 50 is Brambalicious :cheesy: as far as this cautious Clanger is concerned.

As I became tired and impatient around 19:00 I distinctly felt the first tendrils of temptation to trade take hold, resulting in one totally unecessary -5 before I managed to nip my unhelpful survival mechanism in the, er, bid. Must keep these nasty old habits supressed...

Interesting day that featured a false breakdown that bounced strongly off magic 32 (a right handed V bottom on the 1 min, nearly an inv H&S too) and back into the 550-590 rectangle. Look at the vol div on the 5 min - perhaps signifying a lack of selling interest when one might have expected gathering momentum. There was shorter term vol divergence on the 1 min at 18:00 but no convivial ND so I missed the long there, but as probability might have had it fall a lot further given the rectangle break I'm not too bovvered.
I see Soc called the bottom to within 11 which isn't too shoddy

Trades:

1 A 10 point scalp with the 3 bits of TA confirmation that we like
2 A long off 64, again with 3 bits to confirm and closed at target 100 EMA as we were in an ADX confirmed down trend
3 A Chartman style 100 EMA long again off 64ish as the 100 EMA was penetrated to the upside and then successfully tested. The prominent PD on 5 min RSI helped confirm the entry as did the bullish bull flag break. Closed after it hit the measured move flag target of 580 and bounced down.
4 A pointless scalp with only a tiny RSI ND to support it. Silly.
5 A short scalp at the top of the rectangle/opening price level, with better RSI ND but no confirmation from Tick. This made me nervous so I only took 5 here. Was actually worth 20 odd but better to be safe than sore. Perhaps I should have trusted the long topped doji on the 5 min at 19:10 as a reversal clue, especially given the 5 wave up completion though.

No strong trend day yet. I have absolutely no idea what will happen tomorrow, but to have no opinion is a positive in my book. Still, there seem to be 3 dojis on the daily Dow/SPX/Naz and heavy lashings of PD on the 120 min so I reckon up after a retest of 532. Targets 630, 670.

Remember if you can't see the chart properly that's cause it's obscured by numerous harnesses of dubious merit. Though turning off automatic image resizing in yr browser will help.

Had a little glance at TRIN today but it didn't talk to me inspiringly, although predictably I noticed a potential for divergences to confirm trades. More study required.

Very tired now so I guess the old conscious was running a bit hot today. Time for the Douglas ice pack....and a big plate of salmon (not the poisonous sort recommended by Jamie "my principles erode in direct proportion to my income" Oliver fortunately).

 

[frugi]

Off the ball

-2 from three.

A premature long at 520 on the second vol climax. Given that 32 had just failed after "three knocks on the door" I should have expected more than 10 points selling, though in my defence there was a bear flag target around 520. -10

A better long after the test of 500 with Tick PD and a third vol climax, and then a higher low at 510, also a tweezer bottom on the 5 min, covered, again early, at the 100 EMA. +15

A stupid Grail short, stupid because we had already broken the down TL drawn from yesterdays high. Thankfully I realised this and only lost -7.

Then I missed a decent short off 590, a level that represented the top of the range seen over the last two days and also there was a chunky ND on Tick and RSI.

Grr. Still -2 isn't -50, I keep reminding myself.

Knocking off early as I don't feel mentally 100% today. Probably a little complacent after yesterday, always dangerous.

 

[frugi]

postman plod

+28 from three.

Missed the trend as usual, preferring 3 countertrend scalps instead. Always like to make life hard for myself lol.

Some nice divergences today but with such a strong up trend the pullbacks were short, hence my nervous covering.

Didn't trade last Thu/Fri as I felt pretty rough and out of tune with the market. Also I was awaiting the arrival of a further deposit to IB of 4k, bringing the account to 7k. Soon I am going to have to increase size as I am not making my target of $150 per day. However as my point average is satisfactory I see no reason not to add a contract on handsome opportunities.

 

[frugi]

Wake up and smell the complacency...

...or the 147 discipline break.

2 day result: 0 from loads

However as my point average is satisfactory I see no reason not to add a contract on handsome opportunities.

I really shouldn't have said that should I? Ot at least I should have noticed that there is a canyon-deep difference between a handsome opportunity and a falling knife and yesterday I tried to grab the latter, with both paws for good measure. Just as I was wondering where the old impulsive persona was hiding (thinking surely a couple of reads of Douglas wasn't enough to banish it for good and all), it came out to play with all feathers fluffed. I started trading late in the day and there's no need to post a chart as it would be too embarrassing: I fought the trend and the trend won, simple as that. System? What system? I knew better didn't I! No, of course I didn't! I allowed the market to remove far more money from my account than I should have and I am an idiot. I retired staring a 147 point loss in its ugly face, shaking with anger, shock and self-loathing, all the usual stuff. I'd really hoped my days of freezing and allowing my objective judgement to become utterly clouded by emotion were over. Let this serve as a warning that I must always be on my guard as I am able to create a disaster at any time at all. The subconscious is not to be trifled with, ever. It is only me who lets the market take my money, not the market. Right, lesson over....

Sweet dreams were enjoyed by all that night as you might imagine - at one point a lairy time and sales window with a crooked grin was chasing my sorry hide down a deep well :cheesy:

Anyway, as we were near recent lows I decided to hold overnight with a tight stop (there was little more to lose by doing this, relatively speaking) and then I scalped my little wooly heart out today. Result +153 from nine. So, over the two days I am roughly even after commission. Phew indeed.

Two days I would like to forget. I just hope I have learnt my lesson this time. No more trades today as I'm far too wound up and do not wish to push my fortune any further without a (with luck, serene) night's sleep behind me.

 

[Quercus]

I firmly respect this sort of post Frugi, as I've been there myself and never had the strength of character to make it public. I hope this helps to keep the demons at bay. I'm sure this is similar to being addicted to alchohol, or other chemicals. In other words; constantly reminding yourself that you are controlled by emotions will help to keep them at bay.
Rosso will tell you that I once had a mantra that went along the lines of " Hi, my name's Quercus and I trade breakouts". After about a year of ignoring this mantra, I believe I now have it under control!
I do however occasionally sell breakdowns, as this is a totally different animal.
Didn't Elder say that the biggest sign in front of his trading desk said something like - "I am very capable of doing serious damage to my account today". Or words to that effect.
Respect
Q

 

[frugi]

Cheers mate I appreciate your post. "My name's Frugi and I trade 3 setups."
Definitely worth remembering.

Elder has it right. Consistency depends on the decision you're making now. Each and every decision can destroy past victories, but only if you let it.

 

[roguetrader]

Really glad to see that you were able to recover from your "momentary loss of focus" it does and will happen to us all. Don't beat yourself up, it happened, you can learn from it and move on. Just file it away as a reminder to be referenced when you encounter a similar situation. Remember what doesn't kill us makes us stronger. On the positive, what a great piece of trading to trade out of that hole, be sure and give yourself equal credit for a very nice focused piece of trading.

 

[frugi]

chop suey

Thanks for the support roguetrader Perhaps less to do with skill than luck, since I held overnight, mind you. Then again the morning exits were tidy enough.

Nowt today for me except a sackful of whipsaws. Nowt yesterday either for that matter. Still a touch nervous after last week's debacle I guess.

+6 from three and a cheeky GOOG scalp which I won't count. (Crikey GOOG moves a bit eh ) Barely worth posting a chart as my trades were far from exemplary.

Tempted to short 430-440 on the Tick/RSI/vol ND but the BO above 427ish put me off incase it led to a sustained up trend.

As Briefing put it I "just couldn't gain any traction" although a range day like this ought to be a scalper's paradise. Must try harder.

Almost find myself wishing for a trend day tomorrow! Today was almost an NR7 on the daily.

Fri/Mon P/L (or not) below for what it's worth (no use to anyone I know but I like to be consistent!)

 

[sall]

Frugi, it's a great thread, just wondering what is the goal is a still to make 10-15 points a day or has it changed since you've uppped your account.?

 

[frugi]

Tipped off by TRIN

Thanks Sall. My target is 10-15 actual points per day but the way I treat points on this thread is real world, i.e 10-15 points trading two contracts instead of one becomes 20-30 points. With 3 it would be 30-45 and so on. So I'm counting in real $ not points per contract.

As you can see I am failing to make my target of $150 per day by a wide margin, but also as you've pointed out I have been (up until very recently) trading with half the intended account size until I find my feet. Now I've doubled the capital the pressure is on, which, funnily enough, is perfectly reflected in the past few days' horrible results. Even a mere 2 contracts seems to have taken me temporarily out of my comfort zone, predictably leading to silly mistakes, and this is something I must sort quickly.

Today, for instance, on a wonderful trend and reverse day I lost -24 from 3 trades (although it was actually only -12 in real points terms cause I was - with an unhelpful mixture of caution and impatience - trading 2 contracts not one). By that I mean the cautious winning trade didn't make up for the impatient losing ones. Funny how when more money is on the line I start looking at the p/l column and sweating rather than looking at just the price action, which I seemed capable of doing when trading just one contract.

Well I got one thing half right, predicting a trend day of sorts yeserday. All the elements were there for the first hour or two:

Range expansion following consolidation and (almost) an NR7 day yesterday
A delightful wrong footing of the bears with yesterday's drop below hourly/daily support around 425. Loads of them will have been cruelly trapped by the gap and forced to cover, adding fuel to the fire for the first few hours.
Big gap (a big gap up does not necessarily establish the day's direction as up, of course, but it often points to a large subsequent trending move one way or t'other, or as per today, both! Often the break of the first hour's range after a big gap will point to a large move in the direction of the break too, though today most of the move had already taken place).
All main indices trending together - no bifurcation. Small caps less so admittedly but I only look at SPX/Naz/Dow (this may be silly but there's only so much I can watch simultaneously!)
Solid leadership from the higher beta sectors I watch, SOX, BIX, XBD etc.
Lots of TICK readings above 1000 showing institutional buying
TRIN trending down confirming the up trend (incidentally on my chart TRIN is inverted to make it more intuitive to read)....

....until around 5pm UK time. Then it became interesting. TRIN started to diverge significantly from the Dow. Dow making HHS, TRIN making LLs. Lo and behold once the neckline on the daily had been tested around 500 the plunge began. TRIN was as good as announcing this reversal well before it happened. Ironic that I'd taken it off the screen today eh! Wonderful hindsight, as ever. Of course like any divergence you do not know how long it will last but it was still a noticeable heads up that a reversal trade at a significant TA point, e.g century number/big H&S neckline might be wise (and/or exiting from longs too, had I taken one, d'oh!).

Nice symmetry on the pullbacks too, both of them 143 points, look on the hourly. I'll bet a320 shorted an airbusload around 500 possibly with a cry of "If it ain't Boeing I ain't going."

There's a decent channel forming on the hourly now. The fact that it failed to make the top of it today may point to further downside. Another test of the top around 500 tomorrow then down to the bottom, who knows? Meanwhile I clearly need to top up my reserves of patience if I'm to take advantage...

 

[a320]

Nice symmetry on the pullbacks too, both of them 143 points, look on the hourly. I'll bet a320 shorted an airbusload around 500 possibly with a cry of "If it ain't Boeing I ain't going."

:cheesy:

I took a little snap shot of the INDU at the time ...the ES was making its DT

 

[roguetrader]

Also interesting to note the volume divergence, though I must confess I'm not really sure what to read into it. Today was an accumulation day for the DOW and SPX as volume increased significantly over yesterday, but volume on the Nasdaq came in significantly lower today.

 

[sall]

Frugi, Many Thanks for taking time to write out the response. Just to give you my own overview, I've gone through the same scenrio as yourself ,did up the money a few months ago , went horribly wrong nearly blew it all back down to 1k ,therefore added another 1k from the pocket to continue this venture from single contract yet again. The main mistake was me trading from work which I 've vowed never to do again.

I haven't restarted yet trying to take a breather maybe a game of golf may help .The YM is so volatile where is the dow is slow mover, but double the dollar per point, so I may switch this time to the DOW only. This isn';t a good excuse , however the YM just gives me more itchy fingers than dow to quickly exit and enter trades.I say this as from experience in trading the Dow for the last year on Dukascopy I have been pretty smooth and not come anywhere near blowout.Therefore I may switch and start all over from next week with the DOW on IB instead. Decisions, decisions...

Sorry not an encouraging post.

 

[kanale]

reaction rally yesterday, trend should resume to the downside - good luck

 

[roguetrader]

The YM is so volatile where is the dow is slow mover,

Hi just a quick ? I thought YM was the DOW future, or when you say switch to trading the DOW do you mean trading something other than a futures contract. Forgive my ignorance on this as I do nat trade futures